Holding co for all PSUs soon, to report to PMO

The Narendra Modi-led government plans to give more administrative and financial powers to the top management of central public sector undertakings in order to reduce political interference and bring in accountability.

The Narendra Modi-led government plans to give more administrative and financial powers to the top management of central public sector undertakings (CPSUs) in order to reduce political interference and bring in accountability.

This has been suggested in a draft note on CPSU restructuring floated by the ministry for heavy industries and public enterprises. Also on the cards is a single holding company for all CPSUs that would report directly to the Prime Minister’s Office.

“At present, there is a lack of ownership (neither the board nor the holding ministry has the power to take important decisions independently), which leaves scope for formal and informal interference,” said a senior official at the ministry.

The note also suggested a long and uninterrupted tenure for the top executive, separation of ownership and management, enhanced investment limits and financial autonomy.

Oil PSUs had sought more autonomy since its absence hindered their efforts to acquire oil-fields abroad. Moreover, major telecom, power and banking PSUs are currently functioning without CMDs, hampering performance.

In 2011, the SK Roongta Com&shy;mit&shy;tee had suggested listing 50 CPSUs by 2016, but no decision was taken. “Some of the Roongta panel findings are progressive, but challenging,” said UD Choubey, director-general, Standing Conference of Public Enterprises, the apex body of PSUs. He feels all stakeholders involved should hold a series of discussions to empower CPSU’s before they are taken public.